a new tax carrot 25% in 2023

The increased tax reduction of 25% for investment in SMEs via the purchase of FIP and FCPI shares came into force for investments made between March 12 and December 31, 2023.

She is back. The tax reduction increases to 25%, against 18% normally, is anchored a little more in the devices aimed at directing savings towards small and medium-sized enterprises. Like last year, the public authorities obtained the green light from the European authorities to extend this derogatory rate.

In order not to be equated with tax dumping, the IR-SME reduction, a tax carrot designed to encourage investors to direct their investments towards SMEs, indeed requires the approval of the European Commission. The latter confirmed compliance.

A reduction valid since March 12

The decree (1) extending the derogatory rate was published on Saturday March 11, at Official newspaper. It therefore applies since March 12, until December 31, 2023, on payments made to mutual funds for innovation (FCPI), local investment funds (FIP) excluding Corsica and Overseas, and investment in the capital of SMEs (Madelin IR-PME) or recognized companies of social utility (ESUS). Last year, the derogatory rate only came into effect on March 18.

Typically, these tax funds are invested primarily in unlisted small and medium-sized companies that have been in business for less than 10 years, or less than 7 years in the context of FIPs. To obtain the income tax reduction, the individual investor must keep the shares acquired for at least 5 years.

Tax exemption: all the devices to reduce your taxes

(1) Decree No. 2023-176 of March 10, 2023 setting the date of entry into force of the provisions relating to the tax reduction for cash subscription to the capital of small and medium-sized enterprises resulting from Article 17 of Law No. 2022-1726 of December 30, 2022 of finances for 2023

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